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tv   [untitled]    September 8, 2013 1:30pm-2:01pm PDT

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we should give as good as we get. and i think this is a great starting point for doing this and for those young people. we never know where those young people one day will end up. all sometimes people need is a helping hand, some positive role models and it's just a chance. and, so, i'm clearly in support of this and i know my other commissioners are, too, because we all started somewhere ourselves. and someone along the way gave us an opportunity. so, you clearly have my support. i along with commissioner murphy will come down to see what you're doing. when you came last time, i have to say this, i have never seen you. and i thought, i said, why did he only come this time? i hope you keep coming down to the port because there's one thing you need to know about the port of san francisco. we are a community partner of yours. we're a friend. and show up at these meetings. sometimes people always want to
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be like monday morning quarterbacks. come down here, hit the mic, say something, and always say, there is abissue out there, if you have a better solution, bring it forward. people always listen to reason. thank you. >> thank you. i'll echo my colleagues' comments. i would love to see a. philip randolph institute as part of this new program. i've worked with all three organizations in a variety of different capacities so i'm especially pleased to see all three working together to help the youth of our city. i think this is the way things are supposed to work. i think where we take a look at the opportunities and see where they're going and figure out ways to improve them. i want to thank elaine and her staff to can come up with what are better solutions for giving opportunities to our youthv and thank our other port staff and
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also my colleague commissioner brandon who i think really asked some of the tough questions last time around. and i think we all are benefited from t. particularly our youth are benefited from it. i want to thank all of you and i'm very pleased. i also would like to come down, something i think is very important. let our youth know this is something we care about. it may not be one of our largest contracts you but i think it is one that is important to all of us. we know the significant impact it has on our city by bringing everyone into the fabric of our communities here. so, thank you. >> thank you. ~ also. and we'll all be down. >> not a quorum. >> all right, two at a time. elaine, thank you so much for, you know, going back and negotiating the better contract. and i really appreciate you taking the time and making this work. i just wanted to ask, you know, the numbers have changed a lot. i was just wondering why larkin
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street piece went down. and i know that this program was up for -- up to 10 kids to be employed throughout the year. so, i'm just kind of wanting to figure out how the partnership is going to work, who is responsible for what, and how the funding is attached to that. >> okay. i'm going to start the response, but then turn it over to ann to provide more details about the partnership. you're right. when we came for the first review, larkin street had a larger share of the budget but were reduced and higher than the prior contract. and in order to provide more staff hours, i believe that conservation corps needed to cut back a bit on larkin's hours and direct those dollars to more youth hours from the san francisco conservation corps is the best way i can describe it. but it is a larger share than in the last contract for larkin street.
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i understand that larkin street is happy with the budget as proposed and we did achieve the goal of getting more hours to the youth. but i think ann can provide more detail to how the allocation will work. >> actually, elaine explained it perfectly, which is that in order to serve more of the conservation corps members, we had to negotiate a difference in the contract with larkin. and as elaine said, it is greater than their share over the last four years. so, how the partnership is going to work is the conservation corps is the lead agency. so, we have our own crews of 18 to 24 year olds and they will be doing projects as assigned by the port of san francisco. larkin is a separate subcontractor and, so, they will have also their own crews. they have a separate job
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training program. and they also serve a younger cohort of 16 to 17-year-olds, which is something else i know that is important to the port. because anyone under 18 cannot use power tools based on workers' comp and california law, they will be doing different projects, but they will be assigned those projects also by the port. we will not have influence on what it is that we're doing or what they're doing. and same with randolph, they will be getting projects directly from the port and be working within the parameters of their program so that it fits with all the other services that they provide. and, so, we are sort of the fiscal agent, if you will. and, so, we would make sure that we're all in compliance with the city's minimum wage ordinance and that kind of thing. but really, the direct relationship between the projects and the young people is individual to each of the agencies.
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>> okay. so, so, each agency will have a certain amount of hours versus youth employed? >> well, they go together, actually. >> right. >> and, so, you know, what we committed to with the revision was between larkin street and ourselves, is 36 young people. and if i recall correctly, randolph is -- help me out, 5? yeah, yeah, 5 young people. and, so, the port will determine what the projects are that need doing. we go out and say, okay, so, here's a scope of work and here's how many young people we have. here's how long it will take. so, it gets adjusted according to how long the project takes. and we've gotten pretty good at estimating. sometimes it's less, sometimes
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it's a little more. >> okay. that sounds better than up to 10 youth being employed, more like 40 sounds a lot better given the amount of the contract. thank you very much. >> you're welcome. >> any other questions? >> no, no more questions. but i just want to thank all of you so much ~ for putting this partnership together, for increasing the amount actually going to youth. and hopefully with our next rfp we can get even more money to the youth. so, thank everyone. ~ for that. all in favor? >> aye. >> resolution 13-30 is approved. >> item 12 a, informational presentation on the port of san francisco's leasing practices.
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>> thank you, manny. we had to wait for manny. what would we do without manny and his friends from guest services? we wouldn't be here with all their presentations. they're here before we start the meeting and they're here long after. so, thank you all, manny. good afternoon, commissioners. susan reynolds, deputy director for real estate. and i'm here mostly at your request. over time you have asked us what actually is the process to get a lease. and i understand that the staff report is very textbookish-esque.
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hopefully my presentation won't give you a 40,000 foot view of the leasing process. and to compare the port metaphorickally to a business, [speaker not understood], we get everything ready and we manage the revenue stream, a large part of the revenue stream ~ and fill up our properties. so, without our tenants, none of us would be here. and, so, the leasing process starts with an application process and prospective tenants contacting port staff to find out what is available and if what they are doing would fit into port property.
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so, first, you have the application phase of the process. then it goes to an evaluation phase, lease preparation phase, and then the lease execution phase. and the initial contact from the prospective tenants usually comes in the form of a telephone call. and staff has an in-depth conversation with the inquiring party to ensure the uses are compatible with the waterfront plans and the facility. and once that test is met, then we instruct them to start the application process. and as part of your package you received our lengthy application. ~ in one of the exhibits. so, the first application of phase is mostly paperwork and
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fact gathering. then we go to the valuation stage. and the lease is -- the application is not only evaluated by the real estate staff, but we have a host of regulators that like to pay attention to what we're doing. we have historic preservation. we have building code. and we have a lot of partners within the port staff, like the engineering department and the planning development department that help us get through that process. once we have done our major evaluation that also includes looking at businesses or individuals' credit history, we also look at their financial capacity. then the terms are presented to the prospective tenant and any
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negotiating points are reviewed, discussed, and agreed upon. once we get to that point, we get into the physical preparation of the document. and in conjunction with the lease or the legal staff, we pair basically information that goes into terms, use of the property, and then we go into the standard boilerplate lease. and if, based on port policy, the terms are 10 years or greater or the revenue is $1 million or greater, that lease would come before you as an approving body and then in some cases it would need to go to the board of supervisors. any deviation from set port policy is also brought before
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you as an approving body. once there is approval by all the recommended and required parties, the lease execution phase begins and we have to get insurance, security deposits, operations plan, and any other requirements of any of our regulatory bodies. and then the lease is executed. and becomes the ownership of one of the property managers, of which we have five property managers and two senior property managers. [speaker not understood]. thank you all very much for being here. ~ which are in this room. thank you all very much for being here. and to look at our portfolio and what our property managers
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manage, this is a snapshot of the different types of lease properties that we have. and as i go through my presentation, please don't hesitate to interrupt me. as part of the approval process, i've listed here the 10 primary regulatory partners that participate in the port's approval process. as you can see, many parties like to participate in what we are doing. in fiscal year 2012-2013, we executed 72 new leases or licenses with an aggregate
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revenue value of $3,0 64,0 90 and that's an annual revenue amount. ~ and it represents over 5 million square feet. we do 42 special events, and that includes events in cooperation with the giants and with city hall. and also because our port is such a great place to visit, we get a lot of nonprofits that use our properties to raise money for their efforts, like the heart association, susan g. k oman and a variety of other nonprofits. we as a result of our participation with the america's cup, we relocated or had to terminate 37 tenants, and we manage 557 tenancies. and many times we hear about
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the giants and we hear about the exploratorium, and we hear about the ferry building, but i would say 95% of our tenants are small businesses ~. there are city-owned resident businesses and they're working class jobs that support many of the businesses in the rest of the city. we have warehouses that store alcohol for our restaurants, fish processors, and many businesses that take the goods that they store on the port property and deliver them to various businesses around the city. everybody likes a piece of pie, so, this is a snapshot of the agreements that were executed in 2012-13. and as you can see, the majority of them are new agreements that are using our
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properties to become available. and we are proud of the work that we do. and there are projects that come to the port that are -- that don't meet -- they don't quite meet the planning and development -- development projects like you have out of pier 70 or seawall lot 330. ~ that are tenant improvement projects. and as you can see in the next two slides, there are a lot of projects that span the length of our 7-1/2 miles. and to give you a better idea of the wide variety of types of
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properties that we manage, we manage restaurants. we manage office space. and in the lower right-hand corner, it's hard to read, but that is a business called bay natives that is down adjacent to her on's head park. and the gentleman cult ~ cultivates and sells plants native to san francisco. [speaker not understood]. in the top left, you have 601 cesar chavez that is the home of the black coalition on aids. it used to be a restaurant and it's been transformed into a fabulous facility. unfortunately i don't have any pictures of the inside. and they're doing great turning projects inside up there. we have a picture of the ramp. we have a picture of lou's
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blues at fisherman's wharf t. was recently remodels. we have a port project on the right of that that is pier 43 promenade at fisherman's wharf ~. we have a picture of the round house. and the bottom right is the [speaker not understood] building which is a warehouse down at pier 80. in the last five years we have survived a recession and we have survived about 2-1/2 million dollars worth of port property that has been taken over by the america's cup. but as you see with our annual revenue stream, we have continued to increase our revenue year over year, except for a slight dip.
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and we would like to thank you for requesting information on how the process works. it kind of gets hidden in the background, but without a lot of these processes that over the years as an approving body, you set policies in place so that the application process isn't too onerous, it doesn't have to come to you for approval. we can get a new tenant into a facility in three to four weeks. and we're proud of the work we do. we're proud to support our commissioners, tenants, and the city managing this wonderful piece of property. every day it looks better and better. so, if you have any questions, i'm available for questions. >> thank you. >> [speaker not understood]. public comment first or not? >> i can.
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>> i just had a couple questions. i love that timetable [speaker not understood] for a tenant to move in. i like that a lot. what i don't understand is how long -- how long does the environmental review take for some of these projects? and who does that? is it in-house? if somebody wants to -- let me rephrase it. if somebody wants to open a restaurant, do you have to do an environmental study on that? >> it depends on how extensive the project is. if someone wants to rent office space, say, at the ag building, the environmental review is, you know, takes an hour, maybe. all the way up to if somebody is changing use or if there
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are, say, hazardous environmental uses, we have the real estate staff -- shannon, you're here someplace -- richard berman who is out today. they do an assessment of what is going -- the environmental impact for whatever the use is in whatever facility it's going into. and it ranges anywhere from a check off at our weekly pipeline meeting where all the groups come together and check off the things that need to be done to just a check off to, say, for example, power intelligent transportation down at pier 50 where they are maintaining their bus fleet and filling fuel and changing oil. that requires a full-blown operations plan and a larger
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assessment. so, just depends on what the use is, where it's going, and what the environmental hazards presented by the activities is. >> i'd like to elaborate on that a little bit. susan described it very accurately as it reflects her division, but in fact there are outstanding environmental impact reports for almost every piece of property we own. and, so, when something goes quickly and easily as a check off as susan just described, the use is consistent with the outstanding environmental impact report. and somebody either in the planning division of the port or the city planning has done an analysis to confirm that the new use is going to conform with that. in cases where there's a change of use, then that can trigger new environmental impact review under c-e-q-a. we also explain how another environmental practices for the operations side which she was just describing which is a different portion of our division.
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so, i hope that helps. >> you also said, susan, that [speaker not understood] as it relates to small business. i would assume a lot of these small businesses have gone within the envelope of a particular [inaudible]. they're going to renovate or infrastructure work on [speaker not understood] environmental review required. what i'm trying to get at here is why should the process of leasing the property at the port take as long as it does? we have a problem over at dbi for many, many years and we worked so hard to sort of streamline it, make it simple, move the obstacles out of the
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way. and, you know, now we have an over the counter permit system over there which works like a well oiled machine. so, i'm wondering if the port -- i'm just trying to help here -- if the port would look at something like that because we do -- we were don't have a great reputation as far as getting things done as far as leasing -- most people i talk with are hard to deal with. [speaker not understood] i get. i'd like that to improve, you know, not have that sort of stigma that the port is hard to deal with as far as renting space or -- you know, like the commissioner to maybe try and work with some ideas to maybe
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expedite some of this stuff. and also -- also processing a lease would take 40 to 90 days if it's just a lease for an office space for rent for office [speaker not understood] would take that. maybe it doesn't take that. i just need to be enlightened. that's all. >> for a standard lease going into an office, if it's office for office, that's usually 30 days. >> right. >> and anything beyond that is because there are layers of regulatory or policy reviews that need to be done. and, you know, going back to the slide with the regulatory partners, some of the tenants you may be talking to are doing leasehold work, so, they have to go through the permit
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process that does add time. but that's usually after they get their lease. they apply for their permit. so, i guess it depends on what stage they are having difficulty getting through the process. but for the cookie cutter deals, we're looking at 30 days. to rubin solis's credit, we have one of the production companies doing a movie here in san francisco. and i think from start to finish, we got the application and the lease produced, signed, keys in hand. >> [inaudible]. >> less than a week. so, it can be done. we do a lot of those. not that fast, but i'd say 2 to 4 weeks for the cookie cutter deals that aren't a change of use, or don't need an
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operations plan, or needs historic review, or they don't need a building permit. >> maybe i can elaborate on that as well. i would note a couple of things if you really want to be helpful. if you look at the port's's delegated authority to myself and the staff, it is extremely narrow. so, if there is a tenant who doesn't want to agree to a paragraph in that 30-page lease, it takes awhile to negotiate that and for them to decide whether it's worth it for them to come back to the port commission. we don't have the delegative authority to negotiate anything that's not a material change to the standard form lease. that's where one of the hiccups occurs. a second hiccup occurs because sometimes people put on their application that they want to be a warehouse, and then as we're clarifying it turns out they want to be a warehouse and a retail space and that runs afoul of our retail bidding process. so, we work on that. the third hiccup occurs because
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they need a regulatory permit from bcdc, bcdc staff gets 30 days to review such a thing, typically comes back with a list of items that then takes some period of time to be negotiated. a fourth hiccup is the standard indemnification clauses and the city standards for insurance. oftentimes they are very, very difficult for smaller tenants to understand and then get the requisite insurance in place. so, there's any number of places that hiccups do occur because as susan described, unlike the private sector, there are so many places that have impacts. if you add to that that a tenant might want to make tenant improvements, they're not usually knowledgeable of their requirements for historic preservation. so, there is a negotiation around, if you will, moving their vision into something that was acceptable for historic preservation. sometimes they want to have a
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person per square foot that triggers a requirement for a new bathroom or some other thing that we don't have in our old warehouses and that has to be built out and there is a negotiation around who will pay for that. sometimes there are [speaker not understood]. it starts out as photo storage and turns into a museum. so, everything happens. there isn't any one thing i can point to, but if you realery seeking a way to streamline them, maybe what we should look at is what the delegated authorities are for negotiating more broadly around terms in the [speaker not understood]. >> i'd like to do that. if it's on the lease side, if i'm applying for a lease to the port and you guys want a pink piece of paper, it's up to me to get it and get it quick. [speaker not understood]. i

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